Starting a small business in China comes with many advantages. Many entrepreneurs from abroad are rushing to start businesses in this country.

The country is now becoming a very popular option for those who want to set up small businesses from other countries.

Advantage of Small Business in China

Because you are here, I bet starting a small business in China is a possibility you are considering. If that is the case, then you should know one or two about doing business here.

Among the things to know is how to go about the whole process of setting up a small business within the territories of the Republic of China.

2021 Trend: How to Start Small Business in China As Foreigner?

Whether you are considering starting importing or exporting goods, starting a school or college, dealing in beauty products, selling or manufacturing pharmaceuticals, or investing in the healthcare sector, this post takes you through the process of starting your business.

Setting up a small business

The first thing to do is to make a decision on whether you would want to establish your business entirely in China.

You may also want to base just a part of your business such as manufacturing operations in the world’s most developing economy.

You should start by exploring the advantages and disadvantages of having operating entirely in this country.

You should also consider the overall costs of doing business here.

You will find out that the cost of doing business in China is far much lower than operating a business elsewhere.

How to Start Small Business in China

Now, follow the following steps:

Ensure that the business you are setting up will be legal

Provide entities are prohibited from engaging 100 percent in mining, hospital, education, and others.

Chinese nationals have fewer restrictions when it comes to business ownership.

However, if you are a foreign investor, ensure that you are starting a business that will be approved by the relevant bodies.


Decide on the location

As mentioned earlier, China is a very big country. You need to explore the country and know where you should set up your business based on your market.

2021 Trend: How to Start Small Business in China As Foreigner?

The overall cost of setting up and operating the business can also determine the location you choose.

If you are looking to start a business on a budget, you can consider a location in Mainland China.

This is because taxation rates in such areas tend to be lower. But if your target customers are in the big cities, then you should find a location in one of the urban centers.


Business plan For Small Business In China

Create a business plan that is viable, with a budget that has a long term projection.

A business is the most important document for any small business.

It provides guidelines on every aspect. This will come in handy when you will be looking for a financier or loans from lenders.

How to Start Small Business in China

Provide the required documentation

All businesses in China must be registered. The process of registration is easier for businesses owned by Chinese nationals than those owned by foreigners.

The owner of or investor in the WFOE is required to submit documentation from their home country. If you are a foreigner, you have to provide documentation from your country.

If you are from another country, you must also provide documentation validating your financial adequacy in your home country. You will have to also provide evidence that shows your partner has agreed to execute the documents on your behalf.

Have the right documents

You should know what documents are needed for you to be allowed to start a small business in China.

The documents that China’s investing business entity require you to submit are listed below:

  • Articles of Incorporation. Alternatively, you can provide an equivalent copy
  • Bank Letter proving the status of the account of the investor business
  • Original Certificate of Status, particularly for investors from Canada and the U.S.
  • Business license
  • Description of the activities of the investor business, along with other materials, which include a website, brochures, and an annual report, and so on.

All the documents must be submitted in Chinese.

They must also be stamped and signed by the relevant transition institutions.

Hire sales and marketing directors

You need to market your business. Marketing and salespersons will be the ones to help you do this.

Ensure you are explaining your business and what you will be selling to them so they can do the marketing accordingly.

2021 Updated: How To Set Up Awsome Chinese Company Easily (As A Foreigner)?